Leading cryptocurrency lender Nexo has offered to buy distressed competitor Wald, which halted operations due to financial difficulties. The proposal comes after the Singapore-based company said it was exploring restructuring options.
Nexo inks exclusive agreement to trace acquisition of Wald
Singapore-based crypto lending and trading platform Wold, which announced the suspension of withdrawals and other transactions for customers, has been offered a way out of their troubles. On Tuesday, major crypto lender Nexo unveiled that it had signed an indicative term sheet with Wald that gives it a 60-day search period for exclusive talks on an intended acquisition of a rival company.
On Monday, Wald’s management said it was halting operations due to “financial challenges” caused by “volatile market conditions.” It also cited financial difficulties among its partners and attributed the current market environment to the withdrawal of about $198 million by its clients in about three weeks.
Against the backdrop of this latest sign of tension in the industry, Nexo said in a statement that it is now relying on “competent and well-capitalized entities to assist the sector”. The lender plans to acquire up to 100% of Wald, reorganize operations and seek a “deeper presence in Asia”, in case the due diligence process initiated is satisfactory results.
“We sympathize with all those affected by the huge market crash. However, tough times always teach us the importance of business model feasibility and prudent risk management. It is inevitable that industry leaders will emerge out of the current crisis,” commented Tatiana Metodieva, Head of Corporate Finance and Investments at Nexo.
Nexo assured that “it aims to provide immediate support and reduce withdrawal limits imposed on Wald’s platform,” affecting more than 800,000 customers. At the same time, the lender is making plans for the future, including exploring options to provide Wald’s customers with a wider range of retail and institutional products and better services.
Wald’s CEO Darshan Bathija was quoted as saying that “operating under the Nexo umbrella positions us in strength to continue execution of our fiduciary obligations to our customers as well as execute on both companies’ ambitious roadmaps.” Keeps it up, no matter the market conditions.”
The crypto lending sector has seen significant growth over the past few years, but was hit recently by negative events such as a market downturn and the collapse of the Terased (UST) stablecoin in May. In June, US lender Celsius again suspended withdrawals, citing market conditions, after Voyager had done the same a few days earlier. Nexo had also offered to buy Celsius assets.
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